West Shuns Libyan Crude
Oil Price Spike Continues as Energy Giants,
Banks Stop Trading With Gadhafi
By GUY CHAZAN And CAROLYN CUI
MARCH 8, 2011
Big oil companies and Wall Street banks have stopped trading crude with Libya in response to sanctions against the country, threatening a near-shutdown of exports from the North African country and driving oil prices even higher.
Morgan Stanley, which buys Libyan oil for its clients, has stopped buying because of sanctions announced last month, according to a person familiar with the matter. ConocoPhillips Co. said it isn’t exporting any of the 46,000 barrels a day of oil it normally produces in Libya. Exxon Mobil Corp. also said it is complying with the sanctions against Libya. A person familiar with BP PLC said the company wasn’t currently doing any new trading deals in Libya.
These moves are putting further strains on an already-volatile oil market, threatening to send gasoline prices higher around the world. Oil is already trading at its highest level in 2½ years as antigovernment protests sweep further across the Middle East, and worries increase that disruptions could spread from Libya to bigger producers like Saudi Arabia and Iran. Crude futures rose $1.02 per barrel, or 1%, to $105.44 at the New York Mercantile Exchange on Monday.